NVIDIA Corporation

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Bullish +72

TSMC Sales Jump 36% as Memory Stocks Plunge. What It Means for NVIDIA and AMD

AI-generated analysis

📈 TSMC quarterly sales surged 36% to reach roughly 442 billion Taiwan dollars in June, up 67.9% year over year.

🔋 NVIDIA reported Q1 FY2027 revenue of $81.6B, an 85% increase, with non-GAAP EPS of $1.87 versus $1.77 expected.

💻 AMD achieved Q1 2026 data center revenue growth of 57% and non-GAAP EPS of $1.37, beating analyst estimates.

🏭 TSMC's N3 production capacity is sold out, with three new Chiayi facilities projected to generate NT$300 billion in annual output.

🤝 AMD secured multi-gigawatt AI commitments from OpenAI and Meta for its MI450 series chips.

📉 SK Hynix shares plunged 13% amid oversupply concerns, contrasting with the strength of foundry stocks like TSMC.

📊 Morgan Stanley maintains an Overweight rating on NVIDIA with a $288 price target citing sovereign AI and hyperscaler demand.

📉 AMD shares dropped 2.64% on the day due to sector volatility, despite being up 287% over the past year.

⚠️ Investors are watching for potential HBM pricing shifts that could affect the cost structure of NVIDIA and AMD AI chips.

🌍 TSMC's expansion in Chiayi is expected to create 9,000 jobs and solidify Taiwan's role as a critical manufacturing hub.

Bullish Signals
  • TSMC reported a massive 36% quarterly sales surge with June revenue up 67.9% year over year, signaling robust AI demand.
  • NVIDIA delivered exceptional Q1 FY2027 results with $81.6B in revenue (up 85%) and non-GAAP EPS of $1.87, beating expectations.
  • AMD's data center revenue climbed 57% year over year to $10.25B, driven by accelerating AI infrastructure demand.
  • NVIDIA shares are up approximately 28.72% over the past year, reflecting sustained bullish sentiment from Wall Street analysts.
  • AMD has gained 286.99% in stock price over the past year and holds 42 Buy ratings with an average target of $516.12.
  • TSMC's N3 nodes are sold out, confirming that supply remains constrained by high demand for advanced AI chips.
  • AMD has secured multi-gigawatt AI commitments from major clients OpenAI and Meta for its MI450 series roadmap.
Risk Factors
  • SK Hynix shares plunged 13% in the same session as TSMC, reflecting ongoing oversupply concerns in the memory sector.
  • NVIDIA shares traded down 1.99% on the day of the report, tracking broader Asian market weakness rather than company fundamentals.
  • AMD shares dropped 2.64% to $543.14 due to sector-wide semiconductor volatility and anxieties about potential AI capex slowdowns.
  • Analysts warn that a memory selloff could pressure HBM pricing, potentially affecting the cost structure of NVIDIA's Blackwell and AMD's Instinct chips.
Full Analysis
TSMC reported a significant surge in quarterly sales, jumping 36% with June monthly revenue reaching approximately 442 billion Taiwan dollars, up 67.9% year over year. This performance highlights the continued strength of AI demand despite broader market volatility and memory stock declines. The company's N3 production nodes are reportedly sold out, and it is expanding capacity with three new advanced packaging facilities in Chiayi expected to generate over NT$300 billion in annual output. NVIDIA posted robust financial results for Q1 FY2027, reporting revenue of $81.6 billion, an 85% increase year over year, and non-GAAP EPS of $1.87 against expectations. CEO Jensen Huang characterized the current AI infrastructure buildout as the largest in human history. While NVIDIA shares dipped slightly on the day due to sector-wide weakness, analysts maintain a bullish outlook with Morgan Stanley reiterating an Overweight rating and a $288 price target. AMD also delivered strong performance with Q1 2026 non-GAAP EPS of $1.37, beating estimates by 6.2%, and data center revenue rising 57%. The company secured multi-gigawatt AI commitments from major clients like OpenAI and Meta for its MI450 series. Despite a recent stock price drop attributed to sector volatility, AMD shares have gained nearly 287% over the past year, reflecting sustained investor confidence in its AI roadmap. The article notes that while TSMC's foundry success contrasts with memory chip struggles like SK Hynix's decline, investors should monitor potential pricing pressures on High Bandwidth Memory (HBM). Any shift in HBM costs could impact the margins of NVIDIA's Blackwell and AMD's Instinct accelerators. Overall, the supply chain dynamics suggest that advanced packaging demand remains robust while memory oversupply concerns persist.